SS&G’s field exam team has more than a decade of experience with several large banks, conducting both asset-based lending and commercial loan collateral exams. We have the expertise to:
- Test the collateral supporting the borrower’s line of credit
- Evaluate borrowing base reporting
- Identify weaknesses and risks
- Make practical and meaningful recommendations to strengthen your position on the borrowing base
We understand how to assess collateral and test accounts receivable, inventory, accounts payable, and cash to recommend ways to mitigate your lending risk. We recalculate all borrowing base ineligibles, identify and recommend standard ABL ineligibles that are not being reported, perform all standard collateral tests, and provide detailed narratives on the borrower’s processes surrounding A/R and inventory.
Services included in a standard field exam:
- Calculate and recommend standard A/R and inventory ineligibles
- Recommend ways to mitigate lending risk, and strengthen your bank’s position
- Provide highlights of the borrower’s strengths and areas of concern
- Test A/R via a shipping test, cash receipts testing, invoice verifications, and credit memo testing
- Trend the monthly A/R and A/P agings and inventory report balances
- Conduct past due A/R and A/P reviews
- Document A/R, sales, and A/P concentrations
- Compute A/R dilution and turnover days for A/R, inventory, and A/P
- Narrate A/R and inventory processes
- Perform test counts, inventory cost testing, gross profit testing
- List inventory by location and insurance coverage
- Test for and quantify slow-moving inventory
- Test recent disbursements
- Review the last four quarters of federal payroll tax filings and support
- Review bank reconciliations for the most recent three months
- Analyze other assets and liabilities general ledger accounts for their impact on collateral